Strategy as a concept cannot be precisely defined. However, it can be conceptualised as a practice, "a course of action for achieving an organisation's purpose" (De Wit and Meyer 2010, p. 52). Strategic management can therefore be understood to be the process of analysing internal and external conditions and deriving an action plan intended aimed at giving the organisation a direction (Porter, 1996; Thompson and Martin, 2005). The pattern of decisions which embodies an organisation's objectives, purposes and goals and the roadmap for achieving these objectives, purposes and goals comprises its strategy (De Wit and Meyer, 2010). The formulation and implementation of strategy can be modelled to fit over 10 schools of thought on strategy advanced by decades of research on strategy management, sometimes raising some paradoxes. This paper examines strategy dichotomies and their application or impact on corporate strategy with respect to the following:
Strategic Thinking: Logic versus Creativity
Strategy Formation: Is strategy planned or emergent
Strategic Renewal: Is change discontinuous or evolutionary
Strategic Thinking: Logic versus Creativity
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It is mutually agreed that the converses of intuition and analysis generate tension during the strategic thinking process. Researchers and contributors to strategic management making the case for logic argue that for strategy to be effective, the strategic thinking process must involve extensive formal analyses and objective collection and processing of data both from within and without the corporation (Hill and Jones, 2007; De Wit and Meyer, 2010). Rational reasoning enables managers gain an accurate perspective on the different options available before identifying the strategic option that best serves the organisation's cause: achieving its goals and objectives. Logical analysis encompasses assessing internal and external risks, strengths and weaknesses, market need and so on; so that strategy can be thought out to fit each of the above factors.
In contrast to logical thinking, creative thinking involves taking a "leap of imagination" (De Wit and Mayor, 2010, p. 60) without any logically defined reason for taking such a leap. Creative thinking is a divergence from the rules governing rational argumentation towards problem-solving. Strategic thinking from this perspective is therefore not governed by previous arguments or analyses, but is the generation of action plans using intuition (Hill and Jones, 2007). The strategy thinker will use intuitive judgement to derive a vision for the future. Proponents of this approach argue that it is the best way to define problems and generate innovative solutions since rationality has the potential to frustrate the process of generating novel insight, which, they say, should be the objective of strategic thinking (De Wit and Meyer, 2010). See (appendix A) Apple Inc. case study.
Strategic Formation: Is strategy deliberate or emergent?
From the dichotomy of rational versus creative thinking, the paradox of strategy deliberateness versus emergency arises. The deliberate doctrine opines that strategy creation ought to follow a coherent series of steps, a coordination of efforts, strategic resource allocation and utilisation and a prior, systematic programming of all processes and activities in the organisation (De Wit and Meyer, 2010). Strategy is a deliberate, systematic attempt to achieve 'fit' between an organization's internal and external strengths and weaknesses, threats and opportunities (Sadler and Craig, 2003).
The paradox of deliberateness and emergence comes courtesy of the cognitive school of thought. Managers who prefer logic in strategic thinking certainly believe that strategy formation is a deliberate process; whereas those who prefer intuition would go for the opinion that strategy formation is an emergent process. Managers who believe in emergence understand the process of strategy formation as anchored in an organisation's capacity and willingness to stay open to new opportunities or trends, maintaining flexibility to changes in the internal and external environment being able to cognitively discern emerging ideas and concepts and the socio-political and cultural factors; and acting in response (Clegg et al., 2005; De Wit and Meyer, 2010). Strategy thus becomes a reactive process. The deliberate school of thought maintains that strategy has to be crafted; that responding to internal and external factors cannot solely be used to provide an organisation with a roadmap for achieving its objectives and realising its vision. See (appendix B) United Parcel Services (UPS) case study.
Strategy Renewal: Is change Discontinuous or Evolutionary?
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Organisational change is an integral element of the strategy process. 'Strategy' aims to outline an organisation's plan for achieving its objectives. Sometimes, there are abrupt changes in the internal and external environment, shifts in production or project implementation life-cycles or changes in organisation dynamics (De Wit and Meyer, 2010). With such eventualities, the organisation has to renew its strategy.
The paradox of revolution (discontinuous change) and evolution (continuous change) is occasioned by the two approaches to strategic renewal. Continuous change advocates for an evolutionary approach in increasing productivity and operational efficiency (Watson, 2000). Continuous change is feasible with emergent strategy formation since change motivators are everyday observed changes or trends in the internal and external environment.
On the contrary, discontinuous (revolutionary) change involves performing a 'radical surgery' to an organisation's strategy. Unlike evolutionary strategic change, discontinuous change does not involve continual improvement of an organisation's corporate strategy: strategic renewal is achieved by making distinct transformations from one strategic approach to another (De Wit and Meyer, 2010).
Whether strategic renewal is achieved through revolutionary or evolutionary change is dependent on specific factors. In project management for example, revolutionary change is a suitable approach since typically, projects have predefined implementation timelines and budgets (Whittington, 2000). Continuous change becomes appropriate when the organisation undergoing change wants to maintain or improve its operational efficiency and competitive advantage in the long run. However, when organisations continuously evolve their strategies to maintain a competitive advantage, increase productivity and operational efficiency, counter the effects of changes in the external and external environment and meet changing customer or client requirements, revolutionary change is still unavoidable (De Wit and Meyer, 2010). Every once in a while, an organisation has to initiate revolutionary changes, processes and projects that wholly transform their strategic outlook and business processes. See (Appendix C) Ferrari case study.
From the analysis done in this report, it is evident that strategy dichotomies or the paradoxes arising from strategic thinking, strategy formation and strategy renewal are closely interrelated. They arise due to the diversity in the contexts with which strategy is interpreted and understood. Effective corporate strategising, it appears, must be conducted by applying opposing perspectives alongside each other. For example, some specific case may call for a combination of logical and creative thinking in strategy formation whereas others may call for logic only (Clegg et al., 2005). Effective managers should be able to identify which approach will be most effective for each specific case.